Category Archives: Saving

Life can get hectic and I can get lazy. I have noticed lately it has been harder to save money every month. We have had a lot of expenses come up this year. Sometimes it’s for items that eventually will happen like car maintenance, others are just spending extra money on food during the month, or buying contacts for hubby. Every month I try to stay within our allocated budget but our variable expenses like food or just another item always pop up. I have tried not to freak out too much because I know we still live very frugally, but the numbers always surprise me at the end of the month.

So, earlier this month I implemented a different strategy – automatic saving buckets. We have a Capital One 360 account which allows us to open new accounts and name them appropriately. I started doing this for our home and auto insurance and automatically deducting it from our checking account. This worked great because when it came time to pay our bi-annual bill, the money was already allocated for in the account, and I just had to transfer it over. It still hurts paying for insurance but I guess for now it’s a necessary evil.

Here’s our saving buckets so far:

– Emergency Fund – This is where we keep our emergency fund. I don’t have automatic deductions yet for this one since it’s 100% fully funded.

– Home Auto Insurance – $312 gets automatically deducted from our checking account and transferred to this savings account. It is as if we were paying the insurance company monthly, but since we are on a bi-annual plan, the money gets transferred until the bill is due.

– Vacation Fund – So I have a small amount of money getting transferred to the vacation fund. My hopes are this fund will grow so much little by little, one day we will be able to go to Europe. Hopefully before we are 30!

– Brokerage/Property Fund – At the end of this month a small amount of money will get transferred to this account. Originally, my thoughts were this fund will be for buying funds in our after tax brokerage account. But we have been talking about potentially saving up to buy property (land) somewhere down the road.

– IRAs – Money to fund our IRAs on a yearly basis will be transferred to this account on a monthly basis, making sure we have enough money to fund them.

I have also been thinking about adding another fund for Christmas and one for home improvements. I have so many projects that I want to do around the house, but they require some money of course. So far, the cost has just been floated on a monthly basis on the credit card, but it would be nice to know there’s some money already allocated separately for home improvements.

I really like having the automatic deductions. This way I don’t have to worry about making sure we save money, it automatically gets transferred.

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As a personal finance blogger, it’s obvious I care about my finances. I started the blog to keep myself motivated and to learn more about how to manage finances. At 21, I didn’t know a lot of investing, mortgages, credit cards, etc. I understood the highlights – save your money and don’t get into debt. I had learned about the basics of investing from my first boss in high school (I’m eternally grateful for his teachings). Looking back, I have learned so much about personal finance. In the last four years, we started our retirement accounts, established a small emergency fund, started tracking our expenses through mint, bought a house, and are planning for future goals. It’s great progress and I’m very proud of us. My husband constantly reminds me we are doing well for our age. Despite the progress, I still worry. This leads me to think about why I worry so much.

I grew up poor. My parents always provided a roof over our heads and food on the table, but there are many things I went without in life. I knew money was limited and learned not to ask for things beyond my parents’ means. If I wanted to do something, I found ways to go. I volunteered in student council and helped work the dances, in order to not pay the dance fees. I fund raised to pay for band accessories in high school. I saved absolutely every penny I had from baby sitting and other side hustles for years to contribute to a new computer. I don’t mind delayed gratification. I will wait until I think I can afford it, and then I splurge. I constantly analyze the numbers. Are we over budget? Ugh we’re always over budget when it comes to food.

It’s a hard habit to get rid of in life. Some people will say it’s a great habit, it allows me to manage our money. But the constant worry can be stressful. This is probably tied to my childhood.

My parents were always worried about money, constantly fighting over how it was allocated or who was controlling the money. I was often aware of these fights and discussions. I never asked for a big quincenera because I knew it would cause more stress. Having a big party was never a want/desire because from moment one, I knew it would never be possible. More stress meant more fights. I don’t think my parents realized the effect it has had on us. My brother is very aware of the cost of items. He’s choosing to go to community college to complete his basics first before transferring to a 4 year university because he realizes it’s much more affordable. He still has ways to go in the personal finance space, but he’s willing to learn.

My experience with money in my childhood has deeply influenced the way I feel about money. I know I don’t want to live paycheck to paycheck. I know I don’t want to worry about our retirement. I know I don’t want to depend on anyone for money. I know don’t want to fight over money. There’s a reason I am making the choice to save and invest.

Because when there’s not enough money to go around in the household, people stress and worry. I just don’t want that feeling.

Have you ever thought about how your childhood influences your current relationship with money?

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When I first started university, I wanted to major in both finance and history. I had recently changed my mind and switched from software engineering to business school. I’m still not sure if it was a wise decision. Maybe if I had heard from more software engineers who had later turned to sales or business development, it would have been different. But at the time, I thought if you majored in software engineering, you had to be a software engineer for the rest of your life. It may seem illogical to you, but our education system teaches us to see in a straight line. Why did I switch to finance? I wanted to see how to make money. Coming from a low income family, money had always been a predominant issue in my childhood. Money was stressful. It caused arguments and distress. I wanted to avoid this in my life.

I switched to finance to learn more about how to invest and save money. Looking back, I’ve learned much more about personal finance reading on my own than I did from those college classes. Personal finance reading is free compared to the huge college investment.

So with this I leave you with save, save, and save. I know it’s hard. I myself struggle with our savings all the time. Living costs money. We don’t live a very luxurious life, yet sometimes I wonder where is all our money going? So, try to save as much money as possible. Put it in another savings account or transfer it directly to Vanguard; out of sight, out of mind.

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Last year we were really motivated to save up for house purchase. It was exciting to see a set percentage go to our savings account, so that one day we could buy our very first house. The down payment savings account increased every month little by little. The goal motivated us to watch our spending.

Now that we have bought a house we need new goals to motivated us again. Especially me. I like goals. Without goals I tend to just drift away aimlessly.

For us, it’s much easier to save an allocated amount every month. We are not very good at watching our spend and hope we come under in order to meet our budget.

So our plan this year is to set automated saving withdrawals every month.

How does thiswork?

For example, one of our goals this year is to maximize our retirement contributions. I already have a set percentage being withdrawn from my paycheck that goes straight to my 401K. Last week I also set up a monthly ROTH IRA contribution with Vanguard. This will ensure by the end of 2013, I will have my ROTH IRA maximized. My husband does not have a retirement plan available through his work. I’m going to set up a Traditional IRA with Vanguard. Every month a set amount will be withdrawn from our savings account to the Traditional IRA. This will ensure have retirement covered.

I’m considering starting a brokerage account with Vanguard (After-Tax) and having a monthly contribution go to a set of mutual funds. This probably won’t be a huge amount but at least I know it’ll be set aside for our future.

My husband and I have been talking more and more about financial independence. We don’t want to be stuck in the grind forever working for the man. One day we hope to have the freedom to say F*** You!

A forced savings plan is one way to get there. It’s also psychological. Just like every month I make sure all our bills are paid, I will make sure there’s enough in the account for our contributions to be withdrawn from on a periodic basis.

I have found myself buying things for our house and I realize when start making updates that the house needs (remember, it’s a fixer upper), our costs will be higher than when we were renting an apartment.

It seems like bills never end. I finish paying off the electricity bill, only to have the Internet bill show up. I know lots of families struggle to make ends meet. My husband and I jokingly say that at this point in our lives, we work to survive. After all, most of our budget goes to food and living expenses. So it’s a relief for our pocketbooks when we find ways to entertain ourselves for less.

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Well, it’s Wednesday, the day before Turkey Day in the US. Are all my American counterparts ready to eat some turkey??? Gobble Gobble.

So this week I am claiming saving submissions at work. I negotiated with suppliers on two parts with the aid of one of the category managers. The first two submissions total up to $25,000!!! These are baby submissions. The submissions the category managers submit are usually in the hundreds of thousands, if not millions. Hopefully, in two years I will be a category manager, if not sooner!!! By the way, I work in sourcing. In laymen terms, sourcing is the arm of a company that flexes its muscle when the company needs cost reductions, and makes its suppliers reduce their prices. Competition leads to lower prices. And a company always needs cost reductions!!!

So, not only am I thinking about money in my personal life (ahem..personal finance blogger), I also work and think with money every day. Sometimes thinking about so money does drive me a little crazy, so I’m not sure if I suggest it.

Here are my Thanksgiving Plans:

Thursday – Spend it with in-laws and family. Eat turkey and try not to watch football

Friday – Go shop for XBOX 360 in the morning, hit the road to go see my parents. Spend afternoon and evening with parents.

Saturday – Spend morning with parents and little brother. Drive back to Dallas in the evening.

Sunday- Recover

Anybody else shopping for an XBOX 360? What deals have you found so far? What are you doing for Thanksgiving???

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Personal finance bloggers are huge advocates of building emergency funds of 6 months of expenses. It’s actually one of my goals. We want to have saved $20,000 by the end of the year. I’m not sure if we will meet that goal, but at least we will come close to it.

Last night, I bought $3,000 worth of VGHCX shares. I figured since the market was slightly down, I would take advantage of it. After transferring the money to Vanguard, our savings account decreased to $9,000. I want to open my husband’s ROTH IRA, which means I will have to invest $3,000 minimum in his Vanguard ROTH IRA. If I do this our emergency fund will decrease to another $3,000. Granted if I want a month our savings account will stay flat, since I will contribute what we saved in October + November to the ROTH IRA.

My reasoning: The money in our savings account is doing nothing. Seriously, we get like 12 pennies every quarter of interest. That’s awful! I’m depositing thousands of dollars to the bank, and the bank is using it to make money. Not to make ME money, to make the BANK money.

Future savings: We want to buy a house in the near future. We are going to try to save up enough money to buy one by the end of our lease Jan 2014. It’s a pretty crazy goal, but if we make it, it will be great, if we don’t, we will be $1 more dollar closer to our 20% down payment. Knowing that we can pull money from our ROTH IRA (contributions not earnings) at any time for the purchase of our house, makes me wonder if we should max out our ROTH IRA this year, hoping the stocks will make money. I mean if we have to pull $5,000 to contribute to our down payment from our ROTH IRA, maybe the account would have grown to $5300? We would pull $5000 and at least have made $300. Way more than the 12 pennies. I know this is a little risky. What if the market crashes, etc…But the money in the ROTH IRA would be a back up, Just in case we don’t raise enough money for our down payment to avoid PMI. Maybe we may decide to postpone our house purchase to increase our down payment, at least our money would be making money.

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Hi readers. It’s been a few days since I posted my last post. I’m afraid life and my laziness got in the way :/.

Just a quick update: Challenges on marital finances are still being worked out slowly. We talked about it, and came to the conclusion that we don’t want money to get in our way of happiness. We are happy with our life, and will try to figure it out as we go. As much as I want him to get involved in our finances, it stresses him out, so it’s going to take a little push here and a lot of magic to get him to start looking at our finances.

Today, I wanted to tackle some thoughts on saving goals. Ever since we started thinking about buying a house, I have been running numbers in my head. Questions like how much house can I afford, how much will our down payment be, location of our house, etc have been popping in my head! Every time I run the numbers, my head feels like it’s going to explode! You might be wondering why? After all, I am a personal finance blogger and it should be easy for me to advocate saving for a down payment, and lowering expenses to increase savings. Honestly, I often wonder how some personal finance bloggers do it because when I think of the minimum $30,000 we need for our down payment, my stomach does a flip.

Then, I think about maxing out my 401K ($17500), maxing out both our ROTH IRAs ($10,000), contributing to FSA for medical expenses like braces ($2,000), paying down car loan (-$4,000), saving for down payment ($30,000), vacation fund ($5,000) and contributing to an after tax account for investments ($????). Did I mention, we like to live our life! We are not extremely frugal by any means. Those are just some of the goals we would like to achieve in 2013. Are they do able? I have no idea. Honestly, they seem super aggressive to me.

I have read a lot of how to guides on how you can save, etc. But honestly, I like hearing about how people do it. Let me know your story.

How do you determine and prioritize your saving goals?

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It’s time to write down my saving and debt goals for the second half of the year. As you read on my post, Financial Choices, my finances have been driving me crazy lately. I have to admit I am a control freak when it comes to certain things. For example, if you didn’t suspect it already, I like knowing what goes in and out of the bank account, even if it makes me feel bad. I know we have been spending a lot lately, hence the bank account hemorrhage. A lot of it had to do with car purchase, moving to a new apartment, merging accounts (debt). But I think since I started working, we should start climbing up the hill, and building some financial muscle.

So, I found out some information regarding our car loan. Please let me know if this is typical of car loans, since I have never had a car loan before!The interest rate scared me the most!

Current Balance: $5238.19, Interest Rate 6.64% Accrues Daily

Accrues daily??? I never heard of it. I thought most loans accrued monthly. I dislike debt very much! This realization made me jump start our debt paying off efforts even if hurts a little bit in the short term.

Here is a summary of our saving and debt goals:

Pay off a minimum of $300 every month, starting this month, July! Send payment during the first week of the month, so money disappears from bank account.

Save $1,000 more in July, $3000 in August (three paychecks), $2,000 in September, $2,000 in October, $2,000 in November, $2,000 in December.

Put 7% to 10% in my employer’s 401K.

I am aiming really high for our savings goals, in hope, we can increase our savings account. Even if we get 50% of the way through the monthly goal, I think we are making excellent progress. This should, also, increase our net worth significantly.

Last but not least, is my blog. I am still not sure what goals I should have for this blog. It is a hobby, and I enjoy writing just for the fact I like to share my experiences. I feel like if people had shared some of their experiences early on with me, I could have learned more. I love learning! So my goals are simple:

Continue to share my experiences with PF world.

Build relationships with fellow PG bloggers.

What do you think? Have you made your saving, debt, and personal goals for the second half of the year?

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As a college student, my budget is pretty tight. Unless it’s extremely urgent and I am about to die, I basically avoid doctors. Healthcare is super expensive! I already pay about $110 on medicine every month I need. I have my yearly checkup with my doctor back home :). However, there are times when I cannot avoid a doctor. There are a couple of ways I saved on my medical bills in college.

First, take advantage of your school clinics! I really love my on campus clinic. When I had tonsillitis freshman year, I went to my on campus clinic, the doctor diagnosed me and gave me medicine.

Second, if you are stressed or going through some hard stuff, make an appointment with your on campus counseling center. You don’t have to pay hundreds of dollars to have someone listen to you. I’m actually a little embarrassed to admit, but I actually went to the counseling center freshman year. I was having some anxiety issues and reached out for help.

Third, if you need any dental work, check out your local dental school. I had to get my wisdom teeth removed, and it was going to be very expensive. Instead of paying $2,000, I paid $500 to get them removed. It took a bit longer to do, but the students and doctors were awesome! I would go there again to have dental work.

Fourth, working out keeps your body healthy and strong. Your immune system is stronger so you are less likely to get sick. Take some group fitness classes at your school gym, or join intramural teams, or sport clubs! They are a lot of fun and you can make friends quickly. I was in my Honors program intramural flag football and volleyball team freshman year. We sucked, but it was fun!!! I actually regret not continuing to do this after freshman year.

Hope this helps you save on some medical bills!

Three more weeks until I turn in my last assignment. It’s going to be tough. I am already stressed out! I, also, heard from one of the jobs I was interested in landing. I did not make the 2nd round. Probably because of my lack of work experience, bah. Oh well, have to stay optimistic! Crossing my fingers. Please send good vibes

What do you think? How much do you pay in medical bills? Do you have any more tips?